Disney hotels discount on Priceline.com to shore up sales

Walt Disney World is marking down its rooms. For the first time ever, the resort has grudgingly agreed to offer its Disney-owned hotel room on the discount site Priceline.com. Starting in mid-November, Mickey Mouse can be had at a deeper discount than before.

While Disney has sold its theme park tickets on Priceline for about four years now (and not at a deep markdown), it held off on expanding its nearly two dozen high-dollar hotels -- such as the Polynesian Resort, the Animal Kingdom Lodge, and the Beach Club -- to the site. Priceline, which offers both standard booking engine results and blind name-your-own-price bidding services, is a budget traveler's friend, but the perception of bottom-scraping discounts chafes against the premium image Disney strives to cultivate for itself.

The Orlando Sentinel reports that Disney will not allow its hotel inventory to appear in the William Shatner-promoted "Name Your Own Price" section of Priceline, but only in the regular search results.

Walt Disney himself despised classism, and he specifically chose hotels with generic themes, such as Polynesia or the "Contemporary," as not to impose upper-class pretensions on his guests. That laudable ethic shattered in the Michael Eisner era, when the snob appeal of construction projects such as the Hotel del Coronado-inspired Grand Floridian made exclusivity a crucial aspect of the Disney profit model. The Priceline-Disney connection announcement will lower that velvet rope slightly for customers who simply can't resist indulging.

Still, occupancy in Disney-owned hotels has been dropping faster than the logs on Splash Mountain. The company's third-quarter sales report, which covered until early July, revealed that occupancy fell 8.8% from the year before. During the same period, Universal Orlando's grand Wizarding World of Harry Potter opened, stealing business.

The shift is also a testament to Priceline's rise. From early 2008 to mid-2010, its travel bookings nearly doubled to $3.4 billion, which is faster than Expedia and Orbitz. It's surely no coincidence that the success of the money-saving travel site neatly coincided with the penny-pinching demands of the recession.

Not that Disney hotels will become the cheapest hotel options. Considering Priceline is currently offering hotel prices near the Walt Disney World for as low as $21 (for the purgatorial Howard Johnson in Kissimmee) and $74 (for a Holiday Inn located on the resort property itself), the rates Priceline will yield will mostly be a mild corrective to Disney's extreme rates, which are overpriced for the Orlando market.

If Disney's lowest-priced, "Value" resorts (the All-Stars and the Pop Century, currently $82 to $119 most times of year without a discount) are offered at a discount, the new price is still unlikely to beat off-property competition, but families will find the fantasy of staying on Disney property to be a little closer to their grasp.
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